Revised Regulatory Framework For NBFCs

On 22^nd October 2021, the Reserve Bank of India or RBI has introduced a revised Scale Based Regulator Framework for NBFCs  in India and the same will be effective from 1^st October 2022.

Regulatory Structure For NBFCs

Regulatory structure for NBFCs shall comprise of 4 layers based on their size, activity, and perceived riskiness. NBFCs in the lowest layer shall be known as NBFC – Base Layer (NBFC-BL). NBFCs in middle layer and upper layer shall be known as NBFC – Middle Layer (NBFC-ML) and NBFC – Upper Layer (NBFC-UL) respectively. The Top Layer is ideally expected to be empty and will be known as NBFC – Top Layer (NBFC-TL)